New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1887-12-10
ROYALTIES ON TELEPHONES.
rur METROPOLITAN ooMPANYs STOCK
yRxarpENr VAIL AND AUDITOR GUERRY TEs1iff-
EXPENSES AND DIVIDENDS.

THE METROPOLITAN COMPANYS STOCK.
p,rs,nrSr VAIL AND AUDITOR GUERRY TESTIFY
EXPENSES AND DIVIDENDS
~. Assembly Telephone Investigating Committee
ansv ran into the affairs Of the Metropolitan Tele-
phone and Telegraph Company yesterday. After
p-..,dent Cutler Of the Ncw-York and New-Jerscy
Company had stated that the per cent Of dividends
in his company, compared to the original cash III
yestmcnt was e.762 year, Theodore n. Vail, the
presdent of the Metropolitan took the stand He IS
. larger man than Mr.. Cutler and without that air OF
polisbed shrcwdness which marks the head Of the
other company.
Mr. Vail testified that the Metropolitan was Or
ranIzcd in May, 1880 and composed Of the
companies then operating in this city, the Gold ana
Stock the National (since Americana Bell, OF New
York. and the Law. The Gold ana
Stock, and Bell were opponents: the Law
operated under the Bell. At that time
the Bells capital stock 100000 The Metro
potans capital stock made 81, 100000, OF when
100000 was paid for the franchise and Sooo'ooo
for property and cash. OF the S4Oo,Ooo' s24o'ooo
went to the Bell stockholders in this city ana $loo'
600 to the Gold and Stock For the Bell properly
e32O,745 II was paid.
The Western Union Company as the owners vi 'ho
Gold and Stock received the 100000 in STOCK anu
the American Bell, the S240, 900, These TWO com
panies now virtually owned by the Metropolitan 'ho
Bell having a GO per cent interest and the western
Union 40 On December l last, tho stock was In
creased to 80 600 900 with provisions for S1oOoOoo
to provide for placing the wires underground VI
tho increase. 81 30, 900 had been paid for.
TERRITORY COVERED BY ONE COMPANY.
Among the directors In the Metropolitan, the Ameri-
ean Eel was represented by Its president and VICE
president, Howard stockton and John f. HudSoh'
while Dr. NOrvln Green, General Eckert ana 6eoree "
Gould were others on tho western Union SIDE Inc
Law Telephone Company, Mr.. Vail sald' had Dec"
bought out for 100000 although 1t wan'eu Si'-oo'
900.
The tcrrltory OF tho Metropolitan embraced this
eftv and took I'm also radius from this city OF
tbirtythree miles, embracing also all Of Long ISahd
and Monmouth County, \. J. 1t operated uhuer
perpetual contract with the American Bel Company
The contract required 1t TO pay royalty on the gross
rental of Instruments less 80 per cent, practically
$40 a year each set
The companies sublcting from the Metropolitan
were the Ncw-Yorh and New-Jerscy, the Westchester
and the Staten Island. Tho Metropolitan received
from these S14 annually for each set OF INSTRUMENTS
Mono of this stock had been sold by the Metropolitan
Mr.. Vail was asked If all the privileges secured oy
the company from the city had cost ii anything
Not that | am aware Of the answer lie
ioncd Mr. Cutler In rortraylng the great expense
telcpbonc companies would have 70 undergo in put
ting wires underground The Metropolitan "oui"
have TO pay $500 mile annual rental Tor each "c'
containing 100 wires, and there would De some l"o
miles while 1t would cost 20 cents foot for cao'c'
Wires laid five years underground in Boston were now
worthless
NEW PATENTS PRoBABLF.
Tho capital of the American Bell Company was
e1OOOO.OOO and the company owned rom 20 10 %
per cent of the stock Of local companies Ells intro
duced into the legislature Of Massachusetts had bcch
reported adversely because unconstitutional IN fixing
rates which the company should charge. That com
many had been authorized by act Of Congress AmcfI-
can Bell stock was worth ola. After 1903, when the
main patent would expire, Mr.. Vail thought that
composition would be more open than now yet inc
American Bell might have other patents which womb
control the of instruments.
OF the companies in Boston. this CITY, OhCeE"'
San Francisco and elsewhere in This country. operating
under the Bell the Metropolitan was the most Pr3ht
, npe a11 Par 90 pdr cent last year The Chicago
company stood next The Bell itself paid annual
q qhc yadty ~ Of the be- Bel patents awaiting
decision in six suits the pc ,, ,h ee Rc ompany
always patented lis inventions soon as made
S. T. Query. the auditor Of the Metropolitan; next
came TO the fore with bundle OF papers which Mr.
Camp the legal guide Of all the defendant companies
said he had slept with all night These showed ma
the net earnings the first eleven months 10 March
81 1851, exclusive of profits on royalties ana alv-
bends from lessee companies, were gu osH % were
Fs0373 80 for the fiscal year ending March l. ls92
s24l774 SO for 1883 s355GSs % for ID. Soi2 59' ~
for 1885. ,4o5 SO for l9s6 and s376oo5 20 ior
sompancs for that period s174 335 o., the div
dends received franchise stock, slG2'23o grand
total Of net receipts, S2s43434 81. .., &, -,
The total amount expended in construction In The
same period 81 ,27l ll6 "a. which, WIN me
5000 600 originally invested made total investment
Of 81 47l. 1864 The construction account up 10
March 81 last embraced S426.72o on the new building
I'm Corilandt-S st.. which has cost $4,000 The gross
earnings OF the company to March 81 last were
s64s4111 O5 the gross expenses $50 gal 90. me
first dividend. $50 900, paid by the company IN
1883 tho total dividends paid so far amounting 10
s745 600 The number Of subscribers last year aver
aged CLOG Tho company pays S16.5oo year on an
old Manhattan Telegraph Company contract when
was among the Cold and stock assets ana runs YET
for thirty-twO years.
There was a good deal said by the officers OF the
COMPANY as 10 expenses involved because OF constant
improvements The now switchboard, which II had
been estimated would cost 100000, would for tbs
reason cost 100000 by the time II was completed
The examination goes on to-day.